The Government move to recap PSBs is timely. The statement of the finance secretary on non-interference in the affairs of PSBs is surprising. The present architecture for supervision of PSBs is robust. PSBs have more supervision than business promotion with multiple checks and balances both within the bank and by external agencies like CVC and CBI. Why the supervision failed is the question.

PSBs should be allowed to run on business priorities rather than regulatory compliance. Government should reimburse the cost of social banking and implementation of government programmes. Non-interference in the policy and day-to-day functioning of banks has been rarely practised. The structure of share holding also increases the hold on the functioning of banks.

S Veeraraghavan

Madurai

While the recent initiative to infuse additional capital would mitigate liquidity risks, the challenge to justify the current valuations and prevention of capital watering confronts institutions. A stable and performance-oriented top management besides an accountable human resource division are therefore prerequisites to promoting a culture of zero-malfeasance and to achieving optimal utilisation of resources. To benefit stakeholders, strategies beyond disinvestments or corporate actions are needed.

A viable rehabilitation plan ought to be implemented to attain complete financial and operational turnaround of PSBs. Although dedicated NPA cells, equitable participation in consortium lending, monitoring of loan sanctions/disbursals and benchmarks for service excellence would improve the loan/asset portfolio and boost profitability of banks, regulators must ensure that the diktats are enforced on the ground.

Girish Lalwani

Delhi

Stipulating Capital Adequacy Ratio involves adjusting the capital according to the asset already created. Is it not like cutting the body (capital) according to the cloth (asset)? While CAR is a business enabling ratio, Asset Creation Multiple (ACM), is a risk business limiting factor and thus is an ideal friend of risk management and control mechanism for banks.

Instead of stipulating Minimum Capital Adequacy Ratio of 12.5 per cent, it is prudent to stipulate Maximum Asset Creation Multiple of 8 per cent. This would go a long way in streamlining the asset quality of banks within. Thus the business model of banks is to be reformed objectively.

Vazhuthur Raghavan

Bengaluru

Filmy reaction

Free citizens in a free country must be free to screen and watch a film cleared by the legally-constituted authority (in India’s case CBFC) without risk to life and limb. But the Karni Sena thinks otherwise and goes on declaring bounties, threatening self-immolations, torching buses, blocking national highways, setting cinema halls and malls on fire, and vandalising public property on the pretext of ‘hurt pride’, albeit with the tacit approval and support of the State administrations in question.

Letting things slide with an eye for the main chance holds a mirror to our social and moral degeneration. State governments abdicated their constitutional duty to abide by the Supreme Court order lifting the ban and enjoining them to maintain law and order. The present round of violence by Karni Sena overshadowing Republic Day celebrations is in keeping with earlier acts of violence perpetrated in the name of religion, nationalism and religion.

G David Milton

Maruthancode, Tamil Nadu

Hardly hunky-dory

This refers to your editorial, ‘Rediscovering India’ (January 25). No doubt the PM has every right to take pride based on the strides the country has made in various spheres and with the IMF being bullish on India’s growth potential in 2018 and 2019. But time is running out fast; people expecti perceptible growth in employment generation, improved farm incomes and a sustained industrial revival. The fight against black money has not made any telling impact on the economy. People who depend upon savings for a living are struggling to find a risk-free product to invest in.

Srinivasan Velamur

Chennai

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